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Mapping sustainability strategies in retail

Retail is in a state of flux, and in addition to technology-driven trends, the focus is currently shifting to sustainability in all areas. Retailers must react and make their businesses more sustainable.
Florian Kraus, Retailsolutions
July 20, 2022
This text has been automatically translated from German to English.

Companies must recognize the importance of a sustainable and fair corporate strategy. Not only in order to comply with legal regulations, but above all to meet consumer demands and their own convictions - because ultimately it is clear to everyone that we only have this one planet. According to various studies, sustainability can also have a direct impact on the bottom line. With strategies for the environment, social issues and corporate governance (ESG for Environment, Social, Governance), the retail sector therefore also wants to implement approaches to create trust and transparency with sustainable reporting.

For example, the industry is committed to producing as little waste as possible and strives to train and educate its employees to learn skills that will enable them to succeed in a sustainable digital world. The question of fair production conditions and environmental compatibility in the manufacture of its suppliers, as well as minimizing greenhouse gas emissions from its products and processes along the value chain, naturally remain central. After all, the industry is more dependent on the favor of its customers than any other and has recognized that there is a need for action.

The fact that more and more suppliers are stepping into the breach with their green products outside the large retail chains shows that the spirit of the times demands this. However, this obligation does not only exist towards the consumer, the suppliers or the own employees. In the meantime, new regulations and laws are also emerging in various countries in connection with the topic of sustainability. 

Admittedly, these are largely effort obligations. Companies subject to the regulations do not have to demonstrate any particular success. All that is required is that they take appropriate measures to prevent a breach of the regulations - and this must be verifiable in case of doubt. For this reason alone, IT systems are needed that allow the precautions to be traced. 

For all these reasons, sustainability strategies and currently, for example, compliance with the German Supply Chain Sourcing Obligations Act or the parliamentary counter-proposal to the Swiss Corporate Responsibility Initiative are at the top of the agenda in executive suites - and in this context, IT departments are also increasingly coming into focus. This is primarily also in order to bring the sustainability strategies, some of which have been developed with external consulting firms, and the expectations of customers and legislators into line with their corporate activities in terms of IT technology. However, this is not entirely trivial - successfully mapping, measuring and controlling the activities related to sustainability strategies requires some effort. That's why many retailers have to rely on third-party solutions to collect and analyze supply chain information, audits, and data on energy consumption, for example.

A large number of software solutions are already on the market in this regard. In extreme cases, the industry is even turning to Microsoft Excel, a tool that it would actually like to put an end to in the course of the end-to-end digitization of business processes.

To avoid media discontinuity, tool proliferation, and the shadow economy, SAP offers integrated enterprise solutions. There is still a lot of movement in this environment, and the requirements of both the market and legislators are also continuously evolving. Nevertheless, enterprise-wide functionalities can help to better cover trade-specific requirements and drive sustainability on a large scale. In this way, processes, experiences and financial insights can be embedded in the core business processes in the best possible way.

Florian Kraus, Retailsolutions

Florian Kraus is Head of Sales and Business Development, Partner at Retailsolutions

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